Where is shipping steering to? Consolidation and Remote...

October 19, 2017 www.hamburgtankers.com

Where is shipping steering to?

Consolidation and Remote Controlled?

by

Dr.-Ing Stephan Polomsky

Hamburg Tankers


Introduction

Two waves are challenging shipping

Consolidation


Market Share Top 20 Owners


Vessel Analysis

2017

Clarksons Research

88,892 ships 24,267 owners 4 vessels per owner

145 owners > 50 ships abt. 12,000 vessels

Container:

World Fleet:

5,154 ships 622 owner abt 8 ships per owner

Operator: 326 carriers abt. 16 ships

top 8 operators > 100 ships

5,154 ships


Consolidation Drivers

• Market Shares

• Economy of Scale

• New Markets, Globalisation

• Synergies and Cost Saving

• Ego, Size

• Service Integration

• Economic Pressure Carriers globally lost in aggregate $10 billion in 2016


COSCO buys OOCL for $6.3B

1996 top 10 had 45% Market share

Within 2 years 8 out of the top 20

2017 top 5 Carrier have abt. 62% Market share

Maersk 18%

MSC 13%

Cosco/ OOCL 13%

CMA CGM 10%

One (3K) 8%

Rest 38%

Market Share by TEU


Consequences of Consolidation

• Price Pressure due to Market Share Fight

• Tramp Owners are left out

• Know How Losses

• Risk Concentration – To big to fail?

• Further Pressure by big Customers (Alibaba)

• Road to Sea Concept fails?

• Size is King – Big Liner Operators dominate

• Only Way to survive


Two waves are challanging shipping

Consolidation

Autonomous Shipping - Benefits & Downsides


Autonomous Shipping

• Reduction of Cost – Crew Cost > 50% of Opex

• Increase System Reliability

• Increase Safety on Board

• Solve Qualification and Training Problem

• Manufactores Driven?

• Elimination of Human Error (80% ?)

Why?

• Reduce Accidents and related Costs


Samples of Developments

THB 5.10. Google goes for Autonomous Vessels - Cooperation with RR

Rolls - Royce


17 mio USD

Starting 3Q 18 manned, thereafter remote and in 2020 fully autonomous, fully electricaly Yara cargoes from Porsgrunn to Bervik and Larvik



Japan plans to launch a fleet of 250 self-driving cargo ships by 2025, to cost hundreds of millions of dollars that could half of the roughly 2,000 maritime

accidents per year.



How it may looks


First Application in the Race?

Introduced in 2016, the two battery driven, double-ended ferries between Anda and Lote on route E39 in Western Norway. In 2018 the Ferry MM 103 FE EL will make her first autonomous voyage accross the 2.4 km fjord but still manned.


Cost Saving?

Very ambitious figures have been published:

• Allianz Study: Human Errors were responsible for 1.6 billion USD damages in 5y – will they disapear in total?

• RR claims to save abt 22% Cost per transported Tonne based on a 20.000 DWT vessel


The NotPetya attack in late June on AP Moller-Maersk shut down 76 terminals around the world and caused disruption for more than two weeks. Cost of $200m-$300m Maersk’s estimation.

On 15.10. the next attack on the servers of BW Shipping was reported – damage still unknown

Risks

• Cyber Attacks

• Data Accurancy

Tesla released remotely extra battery capacity for 30 mile range boost to allow owners to escape from the Hurrican Irma in Florida

Different Business models – ship@ 25 years / software@ 6 months

GPS Data Accurancy – International Conflicts

• Sustainability


Risks

• Social Responsibility

Abt. 1.65 mio Seafarers, 20% from Philippines sending $ 5.5 billon home every year. Heavy impact on surrounding industry, Schools, Training Centers, Agents

• Human responsiblity

Up to end of May 60.000 refugees crossed the Med, 9.500 needed to be Rescued Sailors

• Insurance and Legal

How to insure an Autonomous Ship? Who will be responsible for Damages - Software, System Supplier, Interface maker, Builder, Control Center?


Future of Autonomous Ships

Yes!

• Dedicated Application – Pier to Pier Operation

• Partical Application – Engine Operation, Auto Pilot, Deep Sea

• Mixed Application – Manned, Remote Controll, Autonomous, AI

• No „All Inclusive“ Application – Pilotage, Mooring – all Vessels


Industry 4.0 Block Chain Application Online Booking

Outlook

• Shipping needs to develop itself

Too fragmented, old fashion industry with a High Risk Profile, but little Self Innovation

• Shipping needs intelligent solution

Instead of populistic approaches, suitable solutions need to developed, like leasing models, system lifetime extensions etc.

• Shipping needs a holistic approach

All parties need to be included in the innovation and development circle, manufacturers, builders, owners, operators customers


Thank you

This are only my thoughts to stimulate the discussion

Where is shipping steering to? Consolidation and Remote...

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